What the LA Lakers ‘firesale’ says about sports investing
The fact that Mark Walter found the cash he needs in a professional sports team, and not in his pile of loans and financial instruments, points to a bigger change unfolding in the financial frenzy around sports these days.
The Los Angeles Lakers have just been sold for $12.5 billion to Bob Iger and Josh Kushner. This high-profile sale suggests a larger shift in how sports teams are being valued and traded in the financial world. Mark Walter, the owner of the Lakers, must raise billions of dollars to unwind his financial empire, which is currently under federal investigation for undisclosed related-party transactions.
While Walter is selling off some of his more liquid assets, such as Wall Street-buyable loans, he chose to trade the Lakers first. The deal was completed in three days, but it is not a desperate sale; the Lakers were purchased by Walter for $10 billion less than a year ago. This suggests that Walter is finding it easier to raise capital from wealthy buyers interested in professional sports teams rather than through his extensive network of loans and financial instruments.
The Lakers' sale price is a staggering 10,000 times higher than the losses reported during the financial crisis. This trend of billionaires investing in sports teams, rather than letting creditors take them away, indicates a significant change in the financial frenzy surrounding professional sports.
Written by urgent.news from Semafor's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
